TaxTMI 
TaxTMI 
TaxTMI 
2015 (2) TMI 825
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....alty of Rs. 30 lakhs each and Rs. 5 lakhs has been imposed on the exporter firm and its director Mr. Nickunj Shah and Mr. Piyush N. Sanghvi, Partner of M/s Parth Enterprises under the provisions of Section 114 of the said Customs Act. Aggrieved of the same, the appellants are before us. 2. The facts relevant to the case are briefly as follows. The appellant M/s Nickunj Eximp Enterprises Pvt. Ltd. (M/s Nickunj, in short) filed two shipping bills Nos. 6524973 dated 10/10/2007 and 6528077 dated 13/10/2007 for export of 1135 kgs. and 35.5 kgs of graphite blocks to Ward Commercial, Iran and Microsal International, Dubai. Samples of the goods were drawn on 05/11/2007 and sent to Bhabha Atomic Research Centre (BARC) for test and vide test report dated 29/11/2007, BARC confirmed that the purity level to be ranging from 0.575 to 1.769 ppm and density to be ranging from 1.83 to 1.85 and the graphite appeared to be nuclear grade. Therefore, the goods were seized under a panchnama dated 2-4-2008. Statements of Mr. Nickunj Shah, Director of the appellant firm and Mr. Piyush Sanghavi, Partner of M/s Parth Enterprises, who is alleged by the appellant to be the supplier of the goods were recorded....
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....nt. Hence, there is no violation of Section 113 inviting confiscation and consequently, no penalty can be imposed under section 114. Reliance is placed on the decisions of this Tribunal in the case of Dooars Transports Pvt. Ltd. [1993 (64) ELT 322] and Ramayan Impex [2005 (189) ELT 446] in support of the above contention. In the light of the above, it is pleaded that the appellants should be allowed to take the goods back to town by setting aside the absolute confiscation and penalties imposed. 4. The ld. Additional Commissioner (AR) appearing for the Revenue strongly refutes the contentions of the ld. Counsel for the appellant and his submissions can be summarized as follows: 4.a. Vide notification No. 47 (RE-2006)/2004-2009 dated 20-2-2007, the Foreign Trade Policy 2004-2009 was amended to provide that - "Direct or indirect export and import of all items, materials, equipment, goods and technology which could contribute to Iran's enrichment-related, reprocessing or heavy water related activities, or to the development of nuclear weapon delivery systems as mentioned below whether or not originating in Iran, to/from Iran is prohibited: i) items, listed in INFCIRC/254/Rev8/....
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....ation while examining the application for export licences." Further the conditions for transfers specified in the resolution states that "in the process of determining that the transfer will not pose any unacceptable risk of diversion, exporter shall obtain the following from the recipient and furnish the same along with export licence application to the Licensing authority in the Department of Atomic Energy, Govt. of India, the statements from the end-user specified in clauses (a) to (f) thereof. 4.d. Vide notification dated 20-1-2006, the Central Government has notified the substances to which the provisions of the Atomic Energy Act, 1962 will apply and category 0 specifies "Nuclear materials, nuclear-related other materials, equipment and technology". Serial No. 0A302 specifies "nuclear grade graphite/carbon, having a purity level better than 5 ppm boron equivalent and with a density greater than 1.5 gram/cc in quantities exceeding 30 metric tonnes in any period of 12 months". Notification No. 27 (RE-2007)/2004-2009 dated 7-9-2007 also specifies the said goods under the list of Special Chemicals, Organisms, Materials, Equipment and Technologies to which the restrictions relatin....
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....2 samples from M/s Bright Global Paper and forwarded the same to M/s Nickunj vide letter dated 27-6-2007 and M/s Nickunj tested the samples and confirmed the order for 225 pieces. In the meanwhile M/s Parth had confirmed the order for 50 pieces to M/s Bright Global Paper who had supplied 25 blocks of size 400X400X600 mm which he gave to M/s Midpoint Engineers for machining into size 250X245 mm length. The said goods were sent to M/s Nickunj on 20-9-2007. However as per the statement of Mr. Rasik Savla, Director of M/s Bright Global Paper Pvt Ltd. dated 7-11-2007. He did not know any one from M/s Nickunj and M/s Parth and he had received the order for M/s Nickunj from Mr. Manish Patel, director of M.s Dimash India Pvt. Ltd with a request to issue bills and delivery notes backdated for June 2007 and accordingly he had raised 5 invoices dated 11-6-2007, 12-6-2007, 13-6-2007 and 14-6-2007 for 25 graphite blocks of size 400x400x600 mm without actually supplying any goods, Mr. Manish Patel, Director of M/s. Dimash India Pvt. Ltd. in his statement dated 14-11-2007 had admitted that Mr. Nickunj Shah of M/s Nickunj had approached him about 6 months back with a proposal that he wanted to sho....
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....1.50g/cm 2 in quantities exceeding 30 metric tonnes for any one recipient county in any period of 12 months." was a restricted item. Further Resolution No. AEA/27(I) 2005-ER dated 1-2-2006 issued by the Dept. of Atomic Energy prescribes guidelines for nuclear transfers (exports) under the provisions of the Atomic Energy Act, 1962, which again was in the public domain. From the said resolution, it can be seen that export of nuclear grade graphite could be authorized only upon formal governmental assurances from recipients explicitly excluding uses, which would result in any nuclear explosive device. The said resolution also provided that - "export of any prescribed substance, prescribed equipment or related technology shall be permitted only against an export licence issued in this behalf unless export is prohibited. Each and every application shall be scrutinized on case by case basis and on the merits of each case. Notwithstanding the specific guidelines as applicable, general guidelines will be applicable in all the cases and following relevant factors shall be taken into consideration while examining the application for export licences." From these documents available in the ....
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....ite blocks which the appellant had originally imported from China. This was done with the active assistant and connivance of Mr. Piyush N. Sanghvi, Partner of Parth Enterprises. The supply of 50 graphite blocks of size 225x225x600 mm from 25 blocks of size 400x400x600 mm is a physical impossibility which again shows that the so called transactions were bogus and fictitious. There is no satisfactory explanation as to why the appellant wanted to create a web of bogus transactions with respect to their procurement of nuclear grade graphite blocks. These transactions only strengthen the department's case of deliberate mis-declaration of the goods under export. The appellant's plea ofbona fide conduct by seeking clarification from the DGFT and BARC is again a deliberate attempt to mislead. Notification No. 47 (RE-2006)/2004-2009 dated 20-2-2007, amending the Foreign Trade Policy 2004-2009 and Resolution NO. AEA/27 (I) 2005-ER dated 1-2-2006 issued by the Dept, of Atomic Energy prescribing the guidelines for nuclear transfers (exports) under the provisions of the Atomic Energy Act, 1962 were already in the public domain as per which nuclear grade graphite needed a specific licenc....
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....d this responsibility by obtaining the test report from BARC that the goods are nuclear grade which needs a specific permission/licence for its export. 5.5 The reliance placed by the appellant on the decisions in the case of Asian Food Industries and Dooars Transport Pvt. Ltd. actually do not support the case of the appellant at all as the facts are quite different and distinguishable. In the Asian Food Industries case, 20 containers of pulses and grains were exported during 22/06/2006 to 24/02/2006. In respect of another 87 containers shipping bills were filed and 'let export' orders given on 23rd, 24th and 26th June, 2006 the Central Govt. issued a notification banning the export of pulses. The question before the court was whether the ban would apply in case of export consignments where let export orders had already been given. The Hon'ble apex court observed that Section 51 of the Customs Act, which provides for grant of let export order by the proper officer of customs after satisfying that the goods are not prohibited and the exporter had paid the duty, does not say that unless and until the shipment crosses the international border, the notification imposing prohibi....
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.... reliance on a decision is not proper. The following words of Lord Denning in the matter of applying precedents have become locus classicus: "Each case depends on its own facts and a close similarity between one case and another is not enough because even a single significant detail may alter the entire aspect, in deciding such cases, one should avoid the temptation to decide cases (as said by Cordozo) by matching the colour of one case against the colour of another. To decide therefore, on which side of the line a case falls, the broad resemblance to another case is not at all decisive.'' 5.6 The hon'ble Apex Court in the case of Om Prakash Bhatia (supra) had an occasion to examine the scope of term 'prohibited goods' and confiscation of such goods under the provision of section 113 and held as follows:- "113. Confiscation of goods attempted to be improperly exported etc. - The following export goods shall be liable to confiscation :- (d) any goods attempted to be exported or brought within the limits of any customs area for the purpose of being exported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force." 7....
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....s is that any goods which are imported or attempted to be imported contrary to "any prohibition imposed by any law for the time being in force in this country" is liable to be confiscated. "Any prohibition" referred to in that Section applies to every type of "prohibition". That prohibition may be complete or partial. Any restriction on import or export is to an extent a prohibition. The expression "any prohibition" in Section 111(d) of the Customs Act, 1962 includes restrictions. Merely because Section 3 of different expression "prohibiting", "restricting" or "otherwise controlling", we cannot cut down the amplitude of the word "any prohibition" in Section 111(d) of the Act. "Any prohibition" means every prohibition. In other words all types of prohibitions. Restriction is one type of prohibition. From item (I) of Schedule I. Part IV to Import Control Order, 1955, it is clear that import of living animals of all sorts is prohibited. But certain exceptions are provided for. But nonetheless the prohibition continues." 5.7 If we apply the ratio of the above decision to the facts of the case before us, the export of nuclear grade graphite required a specific licence for the purposes ....